Ada L. Stein

GrowthWheel International Inc.

Partner Relations

EBN Tech Camp 2014

The ‘Lean Startup Paradigm’

New tools and approachesthat change the way wework with entrepreneurs

Work that mattersMaking a difference

“My advisor made all the

difference to me”

The ProblemAdvisors told us their

experience with business plans

“Nobody likes to write a business plan!”

“Nobody likes to read a business

plan!”

Here is what advisors said...

Why don’t Business Plans work?

“Business plans are fiction”

“Business plans are a distraction”

“Business Plans are static”

In 2010 this was news..But not so much anymore

“Students come in here saying they want to write a business plan, but that’s the last thing they need to do.

The only way to get to a point where you have a truly entrepreneurial idea is to use a creative approach.”

—Candida Brush, Chair of the entrepreneurship division and director of the Arthur M. Blank Center for Entrepreneurship at Babson College in Wellesley,

Massachusetts

“This idea that the future is predictable and that there is this perfect plan that you can write and then implement, I think that is a

real dangerous way to think about it. “

—Saras Sarasvathy

A paradigm shift

5 new ideas

Customer Development Methodology

Steve Blank

Lean Startup

Erik Ries

Effectual Entrepreneurship

Saras Sarasvathy

Business Model Generation

Alex Osterwalder

GrowthWheel® Toolbox

David Madié

The “Lean Startup Paradigm”

– A likely title for the new paradigm

due to the popularity of Eric Ries’s

book by this title

Summary

The paradigm shift in developing start-ups

BUSINESS PLAN

PARADIGM

LEAN STARTUP

PARADIGM

Planning Experimentation

Market projections Customer Feedback

Perfect design Iterative design

Vision Deliverables

Strategy Operations

Planning Execution

Long-term planning Short-term planning

Executing plans Developing plans

Executing B. models Looking for B.models

Customer DevelopmentSteve Blank

2003

Steve Blank

Customer Development

History

Serial entrepreneur turned professor

2005

path to epiphany

Product Development

Customer Development

“No business plan survives first contact with a

customer”

—Steve Blank, Silicon Valley–based retired serial entrepreneur.

Lean StartupEric Ries, 2011

Eric Ries

The Lean Startup

“The future is unpredictable … Yet most startups … still are managed

by using detailed business plans.”

—Eric Ries

EffectualEntrepreneurship

Saras Sarasvathy

Saras Sarasvathy

Effectual Entrepreneurship

“Business plans have their time and place, though

perhaps not in planning a business.”

—Saras SarasvathyProfessor, Co-Author Effectual Entrepreneurship

Business Model Generation

Alexander Osterwalder

Alex Osterwalder

Business Model Generation

Business Model Generation (Tool)

Osterwalder

"People put too much detail into a business plan. [..]No matter what you write and the numbers you derive for your business plan, the reality is in fact different to

what you imagined.So business plans don't work. We need to burn

them!"

—Dr. Alex OsterwalderUniversity of Lausanne, Switzerland

Text

GrowthWheel®

Started in 2005

GrowthWheel® challenges for all businesses

All industries. All life-stages. All sizes.

An attractive

BUSINESS CONCEPT

Lasting

CUSTOMER RELATIONS

Profitable

OPERATIONSA strong

ORGANIZATION

External focus:

How to create value

An attractive

BUSINESS CONCEPTLasting

CUSTOMER RELATIONS

Internal focus:

How to be efficient

Profitable

OPERATIONS

A strong

ORGANIZATION

Business

Design

focus

An attractive

BUSINESS CONCEPT

A strong

ORGANIZATION

Business

Development

focus

Lasting

CUSTOMER RELATIONS

Profitable

OPERATIONS

An attractive

BUSINESS CONCEPT

Lasting

CUSTOMER RELATIONS

Profitable

OPERATIONSA strong

ORGANIZATION

Avoiding blind spots

Photo

“I think sometimes as counselors we pick

our own favorite topics when we talk to

the client”

—Rich

SBDC Advisor in Arizona

Breaking down the 4 challenges into 20 focus areas

360° view on business decisions

GrowthWheel

All business decisions in one single toolkit

Growing the company with GrowthWheel®

Brick by brick. Decision by Decision. Action by Action.

Challenging the first ResultsLooking for causes behind the symptoms

360° Screening Pad

Get focus

1

2

3

360 Screening ToolHandout

1

2

3

Call client with questions

Research Google for information

GrowthWheel® Worksheets

Make Decisions

WORKSHEETBUSINESS CONCEPT

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v1.8

Product Definition

Find ways to expand the product portfolio

Intention

By expanding our product portfolio we can attract more customers and increase the revenue on existing customers.

Process

Start by listing all of your company’s core products and services.

Note in which (new) ways the product or the service can be offered in different variations. Also consider whether you are able to offer a service to a physical product, or a physical product to a service.

Continue by listing all current and maybe even new introductory products and services. These might be the first purchases of new customers.

Evaluate your options for defining add-on products and services that can change or improve the core products.

Finally define the most extended or luxurious flagship product that your company is able to offer customers.

Next Step

Produce an action plan to develop new products and services that will expand your company’s product portfolio.

Y2.01

CHECKLIST FOR PRODUCT AND SERVICE VARIATIONS

Variation options for servicesVariation options for

products

Variation options for

products and services

Duration (short, medium, long) Level (low, medium, high) Quality (low/good/high) Staffing Scope

Color (red/green/blue, etc.)Size (S/M/L)Materials (wood/plastic/metal)Quality (low/good/high)

Price (low/medium/high)Technology (low-tech/high-tech)

BUSINESS CONCEPT :: Product Portfolio

INTRODUCTORY

PRODUCTS

Variations:ADD-ON

PRODUCTS

CORE

PRODUCTS

FLAGSHIP

PRODUCTSPackaged

solutions

WORKSHEETORGANIZATION

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v1.8

Employee Profile

Describe the ideal profile

of the next employee

Intention

By determining a profile for the type of person we would like for a new available position we increase the probability of finding just the right person for the job.

Process

Start by writing the job title and who the new employee will refer to.

Continue by putting into words how you imagine the next employee in terms of education, professional and personal skills, knowledge, mind-set etc.

Also try to imagine what kind of career the person has built so far.

Finish by trying to map how the future career of this person will turn out in the company.

Next Step

Use the profile to write the job advertisement. Also use it as inspiration for the questions for the job interview.

ORGANIZATION :: EmployeesR2.21

Next year 2 years 5 years

Last job Last job Job today

FUTURE CAREER PATH

CAREER SO FAR

Mind-set

Professional skills

Knowledge

Education

Personal skills

Title:

Will refer to:

POSITION

WORKSHEETCUSTOMER RELATIONS

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v1.8

How good are we at it?

(1-5 crosses)

Who should be

responsible for this

from now on?

What can be done in this field?

Sales Chain

Find ways to strengthen each part of the sales process

Intention

By systematically going through all of our processes in sales, we can find new ways of developing our sales skills and thereby increase our revenue.

Process

Start by assessing how good your organization is today at performing the 12 different links in the sales chain. Place a cross in the boxes to score (1-5) your performance, with 5 being the highest. Some links will be more relevant than others, and there might be different situations for different customer segments or product areas.

Then decide which person in the organization should be responsible for what process from now on. Some links in the sales chain can perhaps be outsourced.

Finish off with suggestions of how the sales chain could be strengthened at each link.

Next Step

Implement the suggestions to strengthen the sales effort.

MAINTENANCE

OF THE SALE

CLOSING

OF THE SALE

OPENING

OF THE SALE

#1 Planning of sale

PREPARATION

OF THE SALE#2 Prospect definition

#3 Sales materials

#4 Networking

#5 Customer dialogue

#6 Customer

meetings

#7 Proposal and offer

#8 Negotiation

#9

Order/Invoice/Contrac

t

#10 After sale

#11 Client care

#12 Repeat sale

G3.01CUSTOMER RELATIONS :: Sales and Service

WORKSHEETOPERATIONS

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v1.8

Cash Management

Find the best ways to improve short-term and long-term cash flow

Intention

Growth puts strain on liquidity, but several initiatives can generate a better cash flow.

By improving cash flow we generate more liquidity to be used for the growth of the company.

Process

Start by getting an overview of alternative ways of improving the cash flow in the company. Add more opportunities yourself.

Evaluate how suitable each initiative is.

Describe the initiatives that need to be completed in order to improve the cash flow.

Next Step

Schedule time to carry out the various initiatives, or delegate the assignments to other employees.

B1.11OPERATIONS :: Financials

CATEGORY ALTERNATIVE WAYS TO IMPROVE CASH FLOWSUITABILITY

INITIATIVES TO BE COMPLETED

Low Medium High

Debtors

Shorten terms of payment

Digital invoicing

Introduce advance payment

Improve reminder procedures

Introduce interest payment on overdue receivables

Offer cash discount for immediate payments

Creditors

Extend terms of payment

Form installment agreements with creditors

Form installment agreements with tax authorities

Reduce costs and spending

Stock

Cut current stocklevels

Reduce order sizes to suppliers

Reduce minimum stock for re-orders

Increase turnover rate

Reduce stock through consignment

Tied-up capital

Sell assets

Take loans against assets

Leasing of production equipment, inventory or cars

Loans

Get granted an overdraft

Take out a bank loan

Get a loan from personal contacts

Make a factoring deal

Negotiate extension of payments on bank loans

Raising capital

Loans from stockholders

Capital injection from investors

Can the tools be used together?

Let’s compare

What does the tools

have in common?

Same line of thinking

Less trying to predict the future

More planning. Not less.

But different

In constant development

Exploring

How the tools are different

Lean Startup

A set of principles for exploring business issues

Business Model Generation

A tool to find the right business model by combining elements

GrowthWheel®

A tool to make decisions and take action with 360°perspective

Concepts in the Lean Startup Paradigm

New principles and new tools

OPERATIONALSTRATEGIC

PRINCIPLES

TOOLS

Four Entrepreneurial Archetypes

Entrepreneurs see themselves in GrowthWheel®

Inventor Team-builder Rainmaker Administrator

In Conclusion

Make Decisions. Take Action

Thank youLet’s continue the conversation

ada @ growthwheel.com